SECO IMPOSES STRICT REQUIREMENTS ON ITS SUPPLIERS
For Seco, observing fundamental principles on human rights, labor and the environment, and fighting corruption throughout its operations are important. This also includes building sustainable relationships with the company’s raw materials suppliers.
Seco uses the special Code of Conduct that Sandvik developed for the group’s suppliers, built on several international declarations on human rights, labor, corruption and the environment. The objective is to lay a foundation for a sustainable future for Seco and the company’s stakeholders, who together must take into account the financial, environmental and societal impact of operations on the world around us. “A lot of this is not selfevident in every country. That is why our suppliers have to sign a document showing that they share our views on the issues raised in the Code of Conduct,” says Kristina Reutermo, Director of Purchasing, Quality, Environment, Health and Safety at Seco.
No financing of wars Seco’s Code of Conduct takes up five main areas with underlying requirements that suppliers must observe: Compliance, Health and Safety, Environment, Anti-corruption and Competition Legislation, and the largest section, Labor and Human Rights. This means suppliers must treat their employees well and avoid enabling complicity in crimes or other negative influences. “It’s a question of reducing the risks in our business. If one of our suppliers has a subcontractor who is revealed to have irregularities, it’s really not good for us either,” says Kristina, adding that one of the most important subsections concerns what is known as conflict minerals. “That means tin, tantalum, tungsten, and gold, which are often extracted in politically problematic countries. It’s up to us and our suppliers to check the origin and flows of these minerals. It’s crucial that the money we pay for raw materials does not go to financing war, child labor or other terrible things. There are several conventions that our suppliers must comply with in order to have their raw materials certified, something that customers also require us to show.”
Essentially, compliance requires all suppliers to comply with laws and regulations in the countries where they operate, as well as with international statutes and conventions. Seco always complies with national legislation in force, but sometimes imposes stricter requirements. “If we take cobalt as an example, the Swedish limit value for inhalable particles is 0.02 grams per cubic meter of air. Our current requirement is 0.01 gram, which is a way for us to push development forward,” Kristina continues.
ENVIRONMENTAL ASPECTS ARE INCREASINGLY IMPORTANT
The Health and Safety section states that Seco’s suppliers must have a good work environment for their employees, must prevent work-related injuries and must minimize risks. The Anti-Corruption and Competition Legislation section emphasizes several points, including that Seco has a zero-tolerance policy towards bribes and other corruption. To increase awareness of these issues, all Seco employees receive training. The Environment section in turn deals with suppliers reducing the negative effects of their own operations and other links in the supplier chain. “Extracting raw material is quite a dirty process. Our suppliers must prepare environmental plans based on the type of operations they conduct and the environmental risks that go with them,” says Kristina, noting that the environmental aspects are becoming increasingly important. “No one wants to be associated with a company that does not take care of the environment. Environmental legislation has also become more stringent in many countries.”
Seco regularly audits all sections of the Code of Conduct in order to verify that they are up to date and being complied with. Christel Syvänen, Key Commodity Manager Raw Materials at Seco, points out that the Code should continuously be kept in mind. “It’s a matter of constantly being aware as well as making sure that our suppliers understand. Certain countries are generally more vulnerable than others, but we can’t forget to keep an eye on our Swedish suppliers as well. With nearly 7,500 suppliers worldwide, however, we must prioritize those with the greatest risk, such as our raw materials suppliers. We also conduct very careful investigations before we bring in new suppliers. It’s a long process that sometimes takes several years.”